action calendar- continued public hearings€¦ · recommendation: conduct a public hearing and...

Action Calendar- _Continued Public Hearings

24. ZAB Appeal: 2631 Durant Avenue (Continued from November 17, 2015) From: City Manager

Item 9.a.(9)

Recommendation: Conduct a public hearing and upon conclusion, adopt a Resolution: 1) Determining that appeal issues 2, 5, 7 through 9, 12, and 14 are without merit and rejecting the appeal as to those issues; and 2) As to appeal issues 1, 3, 4, 6, 10, 11 and 13, remanding the c;lecision of the Zoning Adjustments Board (ZAB) approving Use Permit No. 2013-10000016 back to the ZAB to hold a public hearing in order to conside~ (1) whether the Notice of Decision (NOD) describes the project the ZAB approved, or alternatively whether the applicant has withdrawn or modified his prior offer to provide a specific number of units at controlled rental rates; and (2) whether the applicant can make a fair return on investment by rehabilitating the existing 18-unit apartment building. Financial Implications: None Contact: Eric Angstadt, Planning and Development, 981-7400

Public Testimony: The Vice-Mayor continued the public hearing. 25 speakers. M/S/C (Arreguin/Moore) to close the public hearing. Vote: All Ayes.

Action: M/S/C (Capitelli/Moore) to A) adopt Resolution No. 67,297-N.S. 1) Determining that appeal issues 2, 5, 7 through 9, and 12 are without merit and rejecting the appeal as to those issues; and 2) As to appeal issues 1, 3, 4, 6, 10, 11, 13, and 14 remanding the decision of the Zoning Adjustments Board · (ZAB) approving Use Permit No. 2013-10000016 back to the ZAB to hold a public hearing in order to consider (1) whether the Notice of Decision (NOD) describes the project the ZAB approved, or alternatively whether the applicant has withdrawn or modified, his prior offer to provide a specific number of units at controlled rental rates; (2) whether the applicant can make a fair return on investment by rehabilitating the existing 18-Linit apartment building; and B) qirect staff to review the appropriateness of Dr. Baar's analysis and provide that information for ZAB's consideration, and that ZAB should also consider the testimony from the December 1, 2015 City Council public hearing regarding the applicant's willful destruction of the existin·g building, along with considering the detriment to affordable housing ·should the demolition be approved. Vote: Ayes- Maio, Moore, Arreguin, Capitelli, Worthington, Droste; Noes- Bates; Abstain- Anderson, Wengraf.

Office of the City Manager

PUBLIC HEARING December 1 , 2015

(Continued from November 17, 2015)

To: Honorable Mayor and Members of the City Council

From: r/Jl}l( Dee Williams-Ridley, Interim City Manager

Submitted by: Eric Angstadt, Director, Planning & Development

Subject: ZAB Appeal: 2631 Durant Avenue

RECOMMENDATION Conduct a public hearing and upon conclusion, adopt a Resolution:

1. Determining that appeal issues 2, 5, 7 through 9, 12, and 14 are without merit and rejecting the appeal as to those issues; and

2. As to appeal issues 1, 3, 4, 6, 10, 11 and 13, remanding the decision of the Zoning Adjustments Board (ZAB) approving Use Permit No. 2013-10000016 back to the ZAB to hold a public hearing in order to consider (1) whether the Notice of Decision (NOD) describes the project the ZAB approved, or alternatively whe'ther the applicant has withdrawn or modified his prior offer to provide a specific number of units at controlled rental rates; and (2) whether the applicant can make a fair return on investment by rehabilitating the existing 18-unit apartment building.

FISCAL IMPACTS OF RECOMMENDATION None.

CURRENT SITUATION AND ITS EFFECTS On June 25, 2015, the Zoning Adjustments Board held a public hearing and approved the.application submitted by Clifford S. Orloff, a Managing Partner of OPCHA, LLC, by a 6-1-1-1- vote (Yes: Christiani, Donaldson, Hauser, O'Keefe, Pinkston, and Pinto; No: Selawski; Abstain: Tregub; Absent: Williams). On July 8, 2015, staff issued the notice of the ZAB decision. Two appeals were filed with the City Clerk: the first was filed on July 22, 2015 by the applicant, Clifford S. Orloff, a Managing Partner of OPCHA (known in the report as 'Applicant'), and the second was filed on July 23, 2015, by Pamela Webster and Matthew Lewis, on behalf of the Associated Students of the University of California (ASUC). The Clerk set the matter for review by the Council on November 17, 2015. On November 3, 2015, staff posted the public hearing notice at the site in three locations and mailed notices to property owners and occupants within 300 feet of the project site, and to interested neighborhood organizations.

2180 Milvia Street, Berkeley, CA 94704 • Tel: (510) 981-7000 • TDD: (510) 981-6903 • Fax: (510) 981-7099 E-Mail: [email protected] Website: http://www.CityofBerkeley.info/Manager

24

ZAB Appeal: 2631 Durant Avenue

BACKGROUND

PUBLIC HEARING December 1, 2015

The project approved by the ZAB would allow the demolition of the existing 18-unit rent controlled residential building to allow the construction of a new 5-story, 56-unit residential building with 40 studios and 16 2-bedroom units, common facilities, bike storage, a rental/management office on the first floor and 2,240 sq. ft. of usable open space on a rooftop deck covered by a trellis. The project approved by the ZAB included four Below Market Rate (BMR) units to partially satisfy the City's Affordable Housing Mitigation Fee1 and also incotporated the applicant's offer to include 20 units with a limit on future rent increases to no more than 65% of the consumer price index (CPI) in the region.

ENVIRONMENTAL SUSTAINABILITY The project is in compliance with all state and local environmental requirements.

RATIONALE FOR RECOMMENDATION The issues raised in the applicant's appeal, and staff's responses·, are as follows. For the sake of brevity, the appeal issues are not re-stated in their entirety; refer to the attached appeal letter for full text.

Issue 1: The Notice of Decision (NOD) "DESCRIBES A Ml\TERIALL Y . DIFFERENT PROJECT THAN THE ONE APPROVED ZAB. THEREBY

. EXCEEDING THE PLANNING DEPARTMENT'S AUTHORITY UNDER CITY LAW." [p. 3-4 of attached appeal letter].

Response 1: Staff believes the NOD accurately reflects the project the applicant proposed, staff analyzed and the ZAB approved.

In November of 2013, the applicant revised the project description to state that he is "agreeing to have the first two floors, 21 units, be subject to Berkeley rent control to replace the 18 units currently under rent control." This offer was again repeated in the revised applicant statement submitted in April 2014. In June 2014, the applicant revised the applicant statement to now state that "[f]ive of the proposed 56 units will be low income units. We are agreeing to have 18 units subject to rent control as existed in the current building."

On May 21, 2015, the applicant again revised the applicant statement to now state that the project would include 18 rent controlled units, and one inclusionary affordab

1

1e housing unit for a very low income tenant. The

· 1 If the applicant were to voluntarily provide five below market units, the required fee under BMC Section 22.20.065 would be $20,000. If the applicant were to provide only one below market unit, as originally proposed, the required fee would have been $900,000. As approved, with four below market rate units, the required affordable housing mitigation fee is $240,000. The applicant may still choose to add more BMR units in lieu of payme!lt.

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ZAB Appeal: 2631 Durant Avenue PUBLIC HEARING December 1, 2015

next day, the applicant again revised the applicant statement to increase the number of replacement units from 18 to "20 Rent Controlled units".

On May 28, 2015, Miller Starr Regalia, on the behalf of the applicant, reiterated the details of the project as "56 units, including 16 two-bedroom apartments and 40 studio apartments. The units will include one affordable unit and, although not required under California law, our client has voluntarily offered to subject 20 of the proposed units to the City's rent control laws." In addition, Miller Starr Regalia stated that the project would make "significant costs contribution to the Housing Trust Fund to support the deve.lopment of additional affordable housing in the City."

In the presentation to the ZAB during the public hearing, the applicant restated the proposed project and offered that he is "prepared to make an agreement with the ren,t board to have them have full authority over tho'se [20] units, including all the authorities they would have as if this building was built, as the current units had. And that's a voluntary agreement. We are prepared to make that with the rent board if the rent board is willing to enter into that agreement with us." When asked for clarification, the applicant again restated that "[w]e are offering to have 20 rent controlled units be subject to the same authority that all the other unit~ that the rent board controls, under the same authorities. A voluntary agreement, but if they enter into it with us, it is binding."

Further, the applicant's representative at the ZAB hearing, Ms. Elisa Mikiten, also restated "[i]t is the applicant's intention to put the [20] units under the control of the Rent Stabilization Board under the identical rules and terms of the existing units. So I think there's some squeamishness about can you make a voluntary agreement. But we make. voluntary agreements all the time. And in fact even the BMR unit is technically a voluntary BMR unit. So itis absolutely our intention to put it under the exact same rules and controls and the same agency as the existing units."

The applicant's legal representative at the ZAB hearing, Sean Marciniak, of Miller Starr Regalia, also stated that " .... [w]hat we have here is an offer by the applicant, and the city through adoption of a condition of approval would accept that offer. So you have an agreement essentially that is governed by normal contract principles. And it is binding ... can the applicant waive its lawful rights? And the answer is yes. If there's full understanding of the terms, no coercion, X, Y, Z, vy_e can waive the rights, and that is what is being proposed here today. And that is what is on page 14 of the conditions of approval. And that's it."

The ZAB discussed the applicant's proposal for replacement units, as well as other strategies to address the loss of the 18 existing rent

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controlled units, and asked if the applicant would consider increasing the number of BMR units in the project (in lieu of paying part of the affordable housing mitigation fee).

After the applicant offered to increase the number of BMR units from one to four in lieu of the Affordable Housing Mitigation Fee, the motion to · approve was amended by Board member Donaldson to increase the total BMR units in the project to four.

Board member O'Keefe seconded the motion and the project was approved on a vote of 6-1-1-1. To prepare this report, Staff contacted Board members Donaldson and O'Keefe regarding their understanding of the motion to approve and both concur that the NOD that staff issued accurately reflected the motion.

Thus, as demonstrated above, and as supported by evidence in. the record as a whole, staff believes the NOD reflects the ZAB's decision. Regardless of whether it was a voluntary offer, the applicant can always withdraw or modify his prior offer to provide a specific number of units at controlled rental rates. However, staff do not believe the applicant withdrew or modified the voluntary offer to provide 20 units at controlled rental rates. Nevertheless, to eliminate any uncertainty as to the motion, Staff recommends that the Council remand the~ decision as to this appeal point to the ZAB for clarification.

Issue 2: The BMC Section 23C.08.030, "BY ITS TERMS APPLIES SOLELY TO PROJECTS THAT RESULT IN PERMANENT OR LONG TERM ELIMINATION OF RENTAL HOUSING FROM THE CITY'S RENTAL HOUSING STOCK." [p. 4 of attached appeal letter].

Response 2: This issue was previously raised by the applicant's attorney in a memorandum dated May 28, 2015, and was addressed by the City Attorney in a memorandum dated June 10, 2015. In his memorandum, the City Attorney demonstrated that the applicant's interpretation above is not supported by the text of Section 23C.08.030 nor the Rent Removal Ordinance (RRO), formerly codified as BMC Chapter 19.56, which was incorporated into the Zoning Ordinance when it was adopted in 1999. As

·explained in the City Attorney's memorandum, BMC Section 23C.08.030.E applies to all applications that seek to eliminate controlled rental units whether through conversion or demolition, regardless of whether they are to be replaced by units whose initial and/or subsequent rents will be limited in some way. Regarding the applicability of BMC Section 23C.08.030.F to this project, the City Attorney concurred with the applicant's legal counsel that it does not apply to the proposed project because the project does not involve the combination and rehabilitation of rent controlled units.

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The appeal does not provide any evidence to suggest that the interpretation by City Attomey was incorrect. Thus, BMC Section 23C.08.030.E applies to this project, and Staff recommends that the , Council find this appeal point to be without merit and reject the appeal as to this issue.

Issue 3: "TO THE EXTENT THE RENT REMOVAL ORDINANCE IS INTERPRETED TO APPLY TO THE PROPOSED PROJECT. IT IS PREEMPTED BY COSTA HAWKINS. WHICH PROHIBITS RENT RESTRICTIONS ON NEWLY CONSTRUCTED HOUSING." [p. 4 of attached appeal letter].

Re$ponse 3: The use permit granted under Section 23C.08.030.E did not mandate the applicant to limit the rents of the newly constructed units or require BMR units. Instead, as well described in response to Issue #1 above, the ZAB's action to approve the project was based on the applicant's representations at the hearing, and in writing for more than a year prior to the hearing, that the project would include voluntarily rent restricted units to replace those that would be demolished. Thus, the ZAB's action to approve the project reflected the project as proposed by the applicant. However, along with recommending that Issue No.1 be remanded to the ZAB for clarification of the ZAB's action, Staff recommends that the Council remand this appeal point to the ZAB to allow the applicant to clarify yvhat if anything it is voluntarily offering in this regard.

Issue 4: THE REQUIREMENT FOR EITHER RENT CONTROLLED OR BMR UNITS AS A CONDITION OF APPROVAL IS NOT SUPPORTED BY APPLICABLE LAW AND CANNOT BE IMPOSED UNLESS THE APPLICANT AGREES TO SUCH A CONDITION IN EXCHANGE FOR VALID CONSID,ERATION." [p. 4 of attached appeal letter].

Response 4: As discussed in response to appeal Issue No.1, the ZAB's action to approve the project reflected the project as proposed by the applicant. The condition of approval (No. 55) was included in the project approval to document the terms in which the City would accept the offer by the applicant to limit annual rent increases and the four BMR units provided in partial compliance with the Affordable Housing Mitigation Fee. However, as with issue 3 above, staff recommends that the Council remand this appeal point to the ZAB to allow the applicant to clarify its position on this issue.

Issue 5: TO THE EXTENT THE RENT REMOVAL ORDINANCE IS INTERPRETED TO DENY THE APPELLANT THE RIGHT TO DEMOLISH AND REBUILD SUCH A BUILDING. "IT IS UNCONSTITUTIONAL ACTION THAT DEPRIVES THE APPLICANT ALL VIABLE USE OF ITS PROPERTY. THEREBY CONSTITUTING AN

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UNLAWFUL EXACTION, AN INVALID LAND-USE RESTRICTION, AND AN UNLAWFUL TAKING OF PRIVATE PROPERTY WITHOUT JUST COMPENSATION." [p. 4-5 of attached appeal letter].

Response 5: The ZAB approved the required permit under Section 23C.08.030.E and other related permits to allow the demolition oHhe existing building and the construction of a replacement building.

As noted in response to Issue No. 2 above, the applicability of BMC · Section 23C.08.030.E and F was addressed by the City Attorney in a memorandum dated May 28, 2015. The City Attorney concluded that BMC Section 23C.08.030.E applies to this project but F does not. This appeal point does not present any new information to suggest that BMC Section 23C.08.030.E does not apply to this project, and Staff recommends that the Council find this appeal point to be without merit and reject the appeal as to this issue.

Issue 6: THE FINDINGS AND CONDITIONS INCLUDE CONDITIONS THAT "IMPOSE A TAKING OF PRIVATE PROPERTY IN THIS CASE BECAUSE THE CITY HAS NOT ONLY DEMANDED THE INCLUSION OF RENT-RESTRICTED UNITS AS A CONDITION OF APPROVAL, BUT IT HAS FURTHER ATTEMPTED TO USURP THE APPELLANT'S CORE PROPERTY RIGHTS BY DEMANDING THE POWER TO DESIGNATE PRECISELY WHICH UNITS HAVE RENT RESTRICTIONS AND BY REQUIRING THIS DESIGNATION TO BE RECORDED ON THE PROPERTY'S TITLE." [p. 5 of attached appeal letter].

Response 6: As stated in response to Issue No. 1, the applicant included this offer voluntarily throughout the review process.

Issue 7:

The condition of approval (No. 55) was written to document the applicant's offer to have the 20 units provide an equivalent occupancy to replace the 18 that would be demolished as well as to document the terms in which the City would accept this offer by the applicant to limit annual rent increases for these units.

Because this condition relates to the applicants apparent withdrawal of the offer to provide replacement units, as with issue 3 above, staff recommends that this appeal point be included in the remand to the ZAB.

"THE IMPOSITION OF MITIGATION FEES PURSUANT TO BMC SECTION 22.20 IS ALSO AN UNLAWFUL TAKING OF PRIVATE PROPERTY UNDER THE UNITED STATES AND CALIFORNIA CONSTITUTIONS" [p. 5 of attached appeal letter]. '

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Response 7: The basis for this appeal point is the applicant's belief that the City did not demonstrate a nexus in support of the imposition of the affordable housing mitigation fees for this project. Pursuant to the Mitigation Fee

·Act (Government Code Sections 66000-66008), the law governing the imposition and administration of impact fees, the City initiated amendments to the BMC to establish the Affordable Housing Mitigation Fee. In 2011, the City Council adopted Berkeley Municipai·Code Section 22.20.065 to authorize an affordable housing mitigation fee on the construction of new rental units in Berkeley. In October 2012, the City documented in a nexus study that the housing needs created by new market rate units could support a fee of up to $34,000. The City Council therefore adopted a fee of $28,000. The City Council later lowered the fee, amount to $20,000 for certain projects, which is the fee amount that applies to this project.

The appeal does not provide any evidence to suggest that the City acted beyond its authority to adopt the Affordable Housing Mitigation Fee. Thus, Staff recommends that the Council find this appeal point to be without merit and reject the appeal as to this issue.

Issue 8: "EVEN IF BMC SECTION 22.20 CAN BE ENFORCED CONSISTENT WITH THE CALIFORNIA AND UNITED STATES CONSTITUTIONS, THE IMPOSITION OF A MITIGATION FEE IS INCONSISTENT WITH THE CITY'S OWN LAW IN THIS CASE BECAUSE THE PROJECT DOES NOT GENERATE ANY BURDENS OR OTHER EXTERNALITIES THAT REQUIRE MITIGATION." [p. 5-6 of attached appeal letter].

Response 8: The October 2012 nexus study documented that the housing needs created by new market rate units could support a fee of up to $34,000 and did not find that housing that might be used by UC students, or merely replace existing housing, generated a different housing need. Also, the Affordable Housing Mitigation Fee does cite cases where an exception to the fee may be granted (for units built to replace units destroyed through no fault of the applicant or for rehabilitated units), but neither would apply here. Thus, the Affordable Housing Mitigation Fee applies to all new rental housing projects in the City, including this one.

Issue 9:

The appeal does not present any information to suggest that BMC Section 22.20 cannot apply to this application or that the conclusions of the October 2012 nexus study were incorrect or that the study in general was incomplete. Therefore, Staff recommends that the Council find this appeal point to be without merit and dismiss the appeal as to this issue.

"THE CITY'S YEARS-LONG DELAY OF PERMIT APPROVALS FOR NEW HOUSING WHILE SEEKING TO IMPOSE CONDITIONS ON

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DEVELOPERS THAT ARE NOT BASED ON PROPERLY PROMULGATED. BROADLY APPLICABLE, AND ENFORCEABLE LAWS UNDERMINES THE DEMOCRATIC PROCESS. FRUSTRATES THE OBJECTIVES OF OPEN GOVERNMENT AND TRANSPARENCY LAWS. DEPRIVES ITS CITIZENS OF SUFFICIENT HOUSING. AND DEPRIVES DEVELOPERS OF DUE PROCESS AND THE PROTECTIONS DUE FROM A GOVERNMENT OF LAWS NOT PEOPLE." [p. 6 of attached appeal letter].

Response 9: The project was first submitted in March 2013, but was later revised seven times over the course of 22 months·to gain approval of the DRC and then the ZAB. The original plans involved a proposal for a 6-story, 71-dwelling unit apartment building and this project would have required significant waivers of the zoning ordinance standards for lot coverage, height and setback. In September 2013, the DRC concluded that the proposed project was out of scale for this neighborhood and that shadow impacts were too great and recommended the applicant to redesign the project if it wanted to gain a positive recommendation to the ZAB from the DRC.

Revised plans were submitted to the City in April 2014, to lower the building to 5-stories, to reduce the number of dwellings to 54, and to provide setbacks and lot coverage that better complied with the existing built environment. While the revised project addressed many of the issues present in the first project, the DRC found the exterior design to be inconsistent with the City's design guidelines, and recommended changes to the project to address massing, setbacks, overall building design and material palate to better fit with the existing built-in environment and its relation to adjacent properties, and that the unit layout and open space required redesign. On June 30, 2014, plans were revised again to increase the number of units to 56, and the exterior design was revised. The exterior design of the building was thereafter revised four times. The DRC still found the revised design to be inconsistent with the City's design guidelines.

Finally, after changing architects, the project was completely redesigned and presented to the DRC in January 2015. The new design was favorably received by the DRC, and in February 2015, the DRC found the new design to consistent with the City's design guidelines and passed a motion to recommend approval to the ZAB.

The time to review this project was greater than most, and required eight DRC meetings to gain a favorable recommendation. Large projects like this require significant time to review and process. How much time it takes is also partly dependent on the applicant's response to City

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comments. During the review of this application, the City was responsive to each resubmittal and scheduled consideration of this project by the DRC within one month of receipt, and was scheduled to the ZAB within four months.

The applicant does not identify or introduce any evidence to suggest any due process violation. Thus, Staff recommends that the Council find this appeal point to be without merit and dismiss the appeal as to this issue.

Issue 10: "AN APPLICANT MAY NOT. CONSISTENT WITH DUE PROCESS, . EQUAL PROTECTION, JURISPRUDENCE,. AND THE RULE OF LAW,. BE FORCED TO 'VOLUNTARILY WAIVE' ITS LEGAL RIGHTS AS A CONDITION OF ISSUANCE OF A PERMIT" WHERE THAT WAIVER DOES NOT REFLECT A VOLUNTARY OFFER BY THE APPLICANT. [p. 6 of attached appeal letter].

Response 10: The ZAB acted in response to the applicant statements that clearly stated that replacement units would be subject to limits on future rent increases, and as noted in this report, the applicant made this offer on multiple · occasions, for over a year prior to presentation of the project to the ZAB. Nonetheless, while it Was made very clear by the applicant that the offer for replacement units was part of his project and there is no evidence in the record to support a conclusion that he was forced to do so, as with issue 3, staff recommends that this appeal point be addressed by the ZAB as part of the remand.

The issues raised by Pamela Webster and Matthew Lewis on behalf of the ASUC are ;;ts follows. For the sake of brevity, the appeal issues are not re-stated in their entirety; refer to the attached appeal letter for full text. ·

Issue 11: "THE APPLICANT CAN MAKE A FAIR RETURN; THE REVENUE PROJECTIONS USED BY STAFF WERE ERRONEOUS AND BASED UPON A MISREPRESENTATION OF THE NUMBER OF ROOMS IN EACH UNIT." [p. 1 of attached appeal letter].

Response 11: This appeal point covers two issues: 1) whether the unit configuration was correct, and 2) whether the City used the appropriate rate of return to consider what was feasible.

Regarding the unit configuration, depending on the source, the number of studios, and one and two bedroom units. in the existing building differ.

According to the application materials provided by the applicant, the existing 18-unit residential building contains ten studios, seven 1-bedrbom and one 2-bedroom units. The applicant also submitted two

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separate appraisal reports, prepared for the former and current property owners, in support of this unit configuration.

In a memo to Planning Staff dated June 10, 2015, Jay Kelekian, Executive Director of the Rent Stabilization Board (RSB), noted that the dwelling units at the project site are subject to the Rent Stabilization Ordinance and therefore are "controlled" rental units, and described the existing building to contain one studio, nine 1-bedroom and eight 2-bedroom units.

To prepare, the Staff Report to the ZAB, Staff used the best data available at that time, and based the pro forma analysis on a building with ten studios, seven 1-bedroom and one 2-bedroom units.

Given the conflicting unit configuration described above for the existing building, to be sure an accurate pro-forma is prepared for this project, Staff recommends that the Council remand this matter to the ZAB to allow staff to review the records to confirm the correct unit configuration and update the pro forma (if necessary).

This appeal point also alleges that Staff used a minimum rate of return in the pro-forma that was too high, and thus the ZAB incorrectly concluded that the applicant could not make a fair return on a project that would rehabilitate the existing building. Regarding the appropriate rate of return to consider for feasibility, staff c~:>ntinues to believe that the range of 6.0-7.0% used in the ZAB report is correct. In projects where financial data was presented to the ZAB, the typical rate of return ranged anywhere from 6.0-7.0%, which the ZAB and staff have considered the range to be acceptable because of its consistency with the return of the market as a whole. Nonetheless, as part of the remand, staff will conduct further research into rates of return and will present this information to the ZAB.

Issue 12: "THE ZAB FAILED TO CAREFULLY CONSIDER THE SERIOUS DETRIMENT TO THE AFFORDABILITY OF BERKELEY'S HOUSING STOCK CAUSED BY THE LOSS OF 18 UNITS THAT WERE RENTED FOR ONLY 65% OF MEDIAN RENT." [p. 4 of attached appeal letter].

Response 12: At the hearing, the ZAB heard testimony from Planning staff, from"RSB staff, from Mr. Orloff, and from numerous members of the public regarding the affordability of the existing 18 rent controlled units. The ZAB also received a memorandum at that hearing from RSB, dated June 10, 2015, which informed the ZAB that the 18 rent controlled units were rented at 65% of the average market rent for 2014. The ZAB clearly understood this, and considered the implication of the demolition. During its deliberation, the ZAB pointed out if the project were to be

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Issue 13:

rehabilitated, the rehabilitated units would be rented at current market rate.

The appeal does not present new information to suggest that the decision of the ZAB was in error. Thus, Staff recommends that the Council find this appeal point to be without merit and dismiss the appeal as to this issue.

"THE 'VOLUNTARY RENT CONTROL' CONDITION IS UNENFORCEABLE AND NOT WHAT ZAB APPROVED. PERMANENTLY AFFORDABLE UNITS WOULD BE A MORE ADEQUATE AND RELIABLE REPLACEMENT." [p. 6 of attached appeal letter].

Response 13: This appeal point covers two issues: 1) what ZAB approved, and 2) whether the project should provide permanently affordable units in lieu of voluntary rent controlled units.

Regarding what the ZAB approved, the appellant argues that the applicant voluntarily offered to provide 20 units at controlled rental rates and to subject those 20 units to the rules and regulations of the Rent Stabilization Board, that the ZAB voted to approve the applicant's offer, but that the Findings and Conditions do not reflect what the applicant offered and the ZAB approved.

Staff disagrees: the NOD accurately reflects the project the applicant proposed, staff analyzed and the ZAB approved. The motion to approve the project only altered parts of the draft Conditions to increase tlile BMR units from one to four units in lieu of (part of) the Affordable. Housing Mitigation Fee payment. The ZAB did not alter the Conditions so as to place a~y portion of the project under the jurisdiction of the Rent Stabilization Board. Nevertheless, to eliminate any uncertainty as to the motion, staff recommends that the Council remand the decision as to this appeal point to the ZAB for clarification.

The appellant also argues the applicant should provide more permanently affordable units instead of 20 units at controlled rental rates. There are no City or State laws that would allow the ZAB or staff to condition the project to provide permanently affordable units.

Nevertheless, because the applicant is now stating that he withdrew his offer to provide 20 units at controlled rental rates, as discussed response to Issue #1 above, staff recommends that the Council remand the decision as to this appeal point to the ZAB for clarification.

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Issue 14: z THE APPLICANT SYSTEMATICALLY DESTROYED THE BUILDING BY EMPTYING IT AND ALLOWING IT TO SIT VACANT, IGNORING THE BLIGHT ORDINANCE AND MULTIPLE CITY WARNINGS TO SECURE THE BUILDING AGAINST TRESPASSERS, INVITING THE FIRE DEPARTMENT TO KNOCK DOWN WALLS AND CHAINSAW HOLES IN THE ROOF, ALL FOR THE PURPOSE OF GAINING A PERMIT UNDER THE DEMOLITION ORDINANCE. THIS BRAZEN APPROACH TO REAL ESTATE SPECULATION MUST BE DISCOURAGED. [p. 6 of attached appeal letter].

Response 14: The ZAB~did not rely on the condltion of the building to approve the demolition permit. Under BMC Section 23C.08.020.A, the ZAB may approve a Use Permit to demolish the building if it makes the finding that either (1) the demolition will remove unsafe structure or (2) the demolition is necessary to permit construction of at least the same number of dwelling units as the demolished structure. The ZAB was aware of the condition of the building, and of the City's efforts to ensure that the building was secured. As documented in the Findings, the ZAB did not approve the demolition permit due to the poor condition of the building. Instead, the ZAB determined that the demolition was necessary to permit construction of the proposed project pursuant to BMC Section 23C.08.020.A.2.

The appeal does not present new information to suggest that the decision of the ZAB was in error or that the ZAB relied on the condition of the building when considering the demolition permit. Thus, Staff recommends that the Council·find this appeal point to be without merit and reject the appeal as to this issue.

ALTERNATIVE ACTIONS CONSIDERED Pursuant to BMC Section 23B.32.060.D, the Council may (1) continue the public hearing, (2) reverse or affirm, wholly or partly, or modify the ZAB's decision, or (3) remand the matter to the ZAB.

Action Deadline: Pursuant to BMC Section 23B.32.060.G if the disposition of the appeal has not been determined within 30 days from the date the public hearing is closed by the Council (not including any Council recess), then the decision of the Board shall be deemed affirmed and the appeal shall be deemed denied.

CONTACT PERSONS Carol Johnson, Land Use Planning Manager, Planning & Development Department, (510) 981-7411 Immanuel Be(eket, Associate Planner, Planning & Development Department, .(51 0) 981-7426

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ZAB Appeal: 2631 Durant Avenue

Attachments: 1: Resolution 2: OPCHA, LLC's Appeal Letter dated July ,22, 2015 3: Webster et al, appeal letter dated July 23, 2015 4: ZAB Staff Report, dated June 25, 2015 5: Index to Administrative Record. 6: Administrative Record 7: Public Hearing Notice

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PUBLIC HEARING December 1, 2015

action calendar- continued public hearings€¦ · recommendation: conduct a public hearing and...

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